Ametek
AME
$237.72
+1.50%
Ametek, Inc. is a diversified industrial company that designs and manufactures advanced analytical, test, and measurement instruments, as well as highly engineered electromechanical components, serving end markets including aerospace, energy, medical, and research. With over 40 autonomous brands, Ametek operates through two primary segments—Electronic Instruments Group (EIG) and Electromechanical Group (EMG)—and positions itself as a niche leader in each market it serves, emphasizing product differentiation and technological leadership. The current investor narrative centers on the company's consistent growth through strategic acquisitions, its ability to expand margins via operational excellence, and its resilience in a mixed macroeconomic environment, with recent attention on its dividend increase and continued outperformance relative to the broader industrial sector.…
AME
Ametek
$237.72
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Investment Opinion: Should I buy AME Today?
Based on the analysis, AMETEK is rated a Buy, supported by strong revenue growth of 11.3% YoY, margin expansion, and a consensus analyst target of $277.50, implying a 17.5% upside. The company's diversified portfolio and low debt provide a solid foundation for continued growth.
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AME 12-Month Price Forecast
AMETEK's strong fundamentals, including double-digit revenue growth and margin expansion, support a bullish stance. The company's low debt and consistent dividend increases enhance its appeal. However, the rich valuation and recent price weakness warrant a medium confidence level. If the company can sustain growth above 10% and maintain margins, the stock is likely to appreciate. Conversely, any signs of deceleration could trigger a de-rating, so monitoring quarterly results is crucial.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Ametek's 12-month outlook, with a consensus price target around $278.06 and implied upside of +17.0% versus the current price.
Average Target
$278.06
0 analysts
Implied Upside
+17.0%
vs. current price
Analyst Count
—
covering this stock
Price Range
$217 - $316
Analyst target range
Ametek is covered by 18 analysts, with a consensus recommendation of 'Buy' and a mean recommendation score of 1.75 (where 1 is Strong Buy and 5 is Sell). The average target price is $277.50, implying an upside of approximately 17.5% from the current price of $236.25. The distribution of ratings includes 10 Buy, 6 Hold, and 2 Sell, reflecting a generally bullish sentiment but with some caution. Recent actions from firms like Morgan Stanley (Equal Weight) and Baird (Neutral) suggest a balanced view, while Truist Securities and DA Davidson maintain Buy ratings, indicating confidence in the company's growth trajectory.
Bulls vs Bears: AME Investment Factors
AMETEK presents a compelling growth story with strong revenue growth, margin expansion, and a solid balance sheet, supported by a consensus Buy rating and a 17.5% upside to the average analyst target. However, the stock's rich valuation, as evidenced by a PEG ratio of 4.05x, and recent price weakness introduce significant risk. The bull case is currently stronger due to the company's consistent execution and favorable end-market trends, but the key tension lies in whether the premium valuation can be justified by sustained double-digit earnings growth. If growth decelerates or margins compress, the stock could face multiple compression, making the valuation the single most critical factor to watch.
Bullish
- Strong Revenue Growth: Q1 2026 revenue grew 11.3% YoY to $1.93B, with consistent sequential growth from $1.78B in Q2 2025 to $2.00B in Q4 2025. This demonstrates robust demand across aerospace, defense, and industrial automation, underpinning the company's growth narrative.
- Margin Expansion: Gross margin improved to 37.2% in Q1 2026 from 36.1% in Q1 2025, while operating margin reached 26.7% in Q1 2026, up from 26.3% in the year-ago quarter. This reflects successful operational excellence initiatives and pricing power.
- Analyst Consensus Buy: With 18 analysts, the consensus rating is 'Buy' (mean score 1.75), and the average target price of $277.50 implies a 17.5% upside from the current price of $236.25. This indicates broad institutional confidence in the company's future.
- Dividend Increase: AMETEK recently raised its quarterly dividend by 10%, signaling strong free cash flow generation and management's confidence in sustained growth. The payout ratio of 19.3% leaves ample room for future increases.
Bearish
- Rich Valuation: The trailing PE of 32.0x and forward PE of 26.1x are at a premium to the broader market, and the PEG ratio of 4.05x suggests the stock is expensive relative to its expected growth. This leaves little room for disappointment.
- High PEG Ratio: The PEG ratio of 4.05x indicates that the market is paying a significant premium for each unit of expected earnings growth, which could lead to multiple compression if growth decelerates.
- Recent Price Decline: The stock has fallen 7.4% over the past 6 months and is down 3.0% in the last trading day, reflecting recent volatility. The current price is 9.5% below the 52-week high of $261.16, suggesting potential momentum loss.
- Mixed Analyst Ratings: While the consensus is Buy, 6 analysts rate it Hold and 2 rate it Sell, indicating some skepticism. Recent actions from Morgan Stanley (Equal Weight) and Baird (Neutral) highlight concerns about valuation.
AME Technical Analysis
Ametek's stock has demonstrated a strong long-term uptrend, with a 1-year price change of +26.5%, significantly outpacing the S&P 500's +18.6% over the same period. The current price of $236.25 sits at approximately 90% of the 52-week range (low: $179.24, high: $261.16), indicating the stock is trading near its highs, which reflects positive momentum but also suggests potential overextension. The stock's beta of 0.997 implies volatility in line with the market, providing a stable risk profile for investors.
Beta
0.99
0.99x market volatility
Max Drawdown
-13.7%
Largest decline past year
52-Week Range
$179-$261
Price range past year
Annual Return
+26.5%
Cumulative gain past year
| Period | AME Return | S&P 500 |
|---|---|---|
| 1m | -6.7% | +0.1% |
| 3m | +4.9% | +4.4% |
| 6m | +7.1% | +14.6% |
| 1y | +26.5% | +18.6% |
| ytd | +13.7% | +12.9% |
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AME Fundamental Analysis
Ametek's revenue trajectory remains robust, with the most recent quarter (Q1 2026) reporting revenue of $1.93 billion, an 11.3% year-over-year increase. This growth is consistent with the prior quarters, as Q4 2025 revenue was $2.00 billion, Q3 2025 was $1.89 billion, and Q2 2025 was $1.78 billion, showing a steady upward trend. The Electronic Instruments Group contributed $1.26 billion (65% of total revenue), while the Electromechanical Group added $664 million, with both segments benefiting from strong demand in aerospace and defense, as well as industrial automation.
Quarterly Revenue
$1.9B
2026-03
Revenue YoY Growth
+11.3%
YoY Comparison
Gross Margin
37.2%
Latest Quarter
Free Cash Flow
$1.7B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is AME Overvalued?
Given Ametek's positive net income, the price-to-earnings (PE) ratio is the most appropriate valuation metric. The trailing PE stands at 32.0x, while the forward PE is 26.1x, implying that the market expects earnings growth of approximately 22% over the next year. This gap between trailing and forward multiples suggests optimism about future profitability, driven by margin expansion and continued revenue growth. The PEG ratio of 4.05x, however, indicates that the stock may be richly valued relative to its expected growth rate, warranting a cautious stance.
PE
32.0x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 25x~31x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
21.4x
Enterprise Value Multiple
Investment Risk Disclosure
Financially, AMETEK carries a moderate debt-to-equity ratio of 0.22, which is manageable, but the company's reliance on acquisitions for growth introduces integration risks and potential goodwill impairment. The current ratio of 1.06 is tight, indicating potential liquidity constraints in a downturn. Free cash flow of $1.70B TTM is strong, but the payout ratio of 19.3% and ongoing acquisition spending could strain cash reserves if growth stalls. Revenue concentration in aerospace and defense, which are cyclical, adds earnings volatility risk, as evidenced by the 11.3% YoY growth in Q1 2026, which could decelerate if defense budgets tighten.
FAQ
The key risks include valuation compression if growth decelerates, macro-driven sell-offs due to its beta of 0.997, and integration risks from acquisitions. Additionally, the company's reliance on aerospace and defense makes it sensitive to budget cuts. The stock's recent 6-month underperformance highlights its vulnerability to market sentiment. Investors should monitor these factors closely.
The 12-month forecast is positive, with a base case target of $250-$277.50, reflecting the analyst average. The bull case could reach $316, while the bear case could fall to $217 or lower. The most likely scenario is the base case, with a 50% probability, assuming continued growth and stable margins. The stock's strong fundamentals support a gradual appreciation, but valuation risks remain.
AMETEK is currently trading at a trailing PE of 32.0x and a forward PE of 26.1x, which is above the industrial sector average. The PEG ratio of 4.05x indicates that the market is paying a premium for expected growth, suggesting the stock is overvalued relative to its growth rate. However, the company's consistent execution and strong margins may justify the premium. The market expects 22% earnings growth, which is ambitious but achievable given recent trends.
AMETEK is a good buy for investors seeking growth at a reasonable price, given its strong revenue growth of 11.3% YoY and margin expansion. The analyst consensus is Buy with a 17.5% upside to the average target of $277.50. However, the stock's PEG ratio of 4.05x suggests it is not cheap, so investors should be prepared for potential volatility. It is a good buy for those with a long-term horizon and tolerance for valuation risk.
AMETEK is best suited for long-term investment, given its consistent growth and dividend increases. The stock's beta of 0.997 indicates market-like volatility, making it less ideal for short-term trading. A minimum holding period of 3-5 years is recommended to ride out valuation fluctuations and benefit from earnings growth. The company's low debt and strong cash flow provide stability for patient investors.